In our everyday life, we frequently hear that X company donated crores of money to a charity under CSR initiative or Y company planted thousands of trees under CSR initiative. What actually is this CSR initiative under whose influence such profit driven companies have been doing good deeds?
According to bdc.ca, “Corporate Social Responsibility (CSR) is the idea that a company should play a positive role in the community and consider the environmental and social impact of business decisions. It is closely linked to sustainability − creating economic, social, and environmental value – and ESG, which stands for Environmental, Social, and Governance. All three focus on non-financial factors that companies, large and small, should consider when making business decisions.”
On 1 April 2014, India passed the rule of mandatory CSR under section 135 of the Indian Companies Act 2013. As per the rule, all the companies registered under the Indian Companies Act with a certain amount of turnover and profits are required to spend 2% of their average net profit for the past three years on CSR.
CSR can be broken down into four types: Environmental responsibility, Ethical responsibility, Economical responsibility and Philanthropic responsibility. Environmental responsibility focuses on sustainability and environment friendly initiatives like increasing reliance on renewable energy sources and afforestation. Ethical responsibility concerns with running of the business in a fair and ethical way like advocating for child labour laws and purchasing fair trade products. Philanthropic responsibility believes in businesses giving back to the society by funding educational programs, supporting health initiatives and community volunteering. Economical responsibility involves companies not being profit hungry. Instead, they take financial decisions that have positive impact on people, environment and society like ensuring fair treatment of all stakeholders of the company irrespective of their gender, race, financial status and designation.
All over the world, companies have come up with various creative ideas to fulfil their CSR commitment. For example, Netflix offers 52 weeks of paid parental leave to the birth parent and non-birth parent under their ethical CSR initiative. Reliance is working towards reducing disparities between rural and urban areas by improving livelihoods and addressing poverty, hunger and malnutrition under their philanthropic CSR initiative. Coca Cola intensively works on waste management and prevention of water wastage under their environmental CSR initiative. Walmart creates economic opportunities for their employees, suppliers and people who work in retail and retail supply chains beyond Walmart under their economical CSR initiative.
KHOJ – Science + Arts + Innovation Museum aims to generate curiosity in minds of all the children of the society irrespective of their social and economical backgrounds. Under the CSR initiative, many organisations and companies are supporting KHOJ towards this goal. Gujarat CSR Authority, a unique and credible platform streamlining the CSR initiatives in the State, is a primary supporter of KHOJ museums. Gujarat State Financial Services Ltd. (GSFS) immensely promotes KHOJ Naranpura and KHOJ Riverfront under their CSR activities. Astral Foundation and Finar foundation of Astral Poly Technik Limited and Finar limited respectively are actively supporting KHOJ Riverfront under their CSR initiatives.